Getty Images
Industryweek 10298 China Steel
Industryweek 10298 China Steel
Industryweek 10298 China Steel
Industryweek 10298 China Steel
Industryweek 10298 China Steel

Cut Steel Output EU Tells China

Feb. 5, 2016
"In the wake of a worrying trend, I urge you to take all appropriate measures to curb the steel overcapacity and other causes aggravating the situation,"  EU Trade Commissioner Cecilia Malmstroem wrote in her letter to Gao Hucheng, Beijing’s commerce minister.

BRUSSELS - EU Trade Commissioner Cecilia Malmstroem has urged China to scale back rampant overproduction in its steel industry that is punishing European companies through low prices, according to a letter seen by AFP on February 5.

European manufacturers are reeling from a global glut in steel supply with Luxembourg-based ArcelorMittal on February 5 blaming China for a colossal $8 billion loss for 2015, with thousands of job cuts announced throughout the industry.

"In the wake of a worrying trend, I urge you to take all appropriate measures to curb the steel overcapacity and other causes aggravating the situation," Malmstroem wrote in her letter to Gao Hucheng, Beijing’s commerce minister.

The letter, sent on January 29, also warned China that it faces new EU probes into alleged price-dumping later this month, with yet more still to come.

It notes that total steel exports from China grew by 50% in 2015, destabilizing the global market and the EU in particular.

China accounts for half the world's crude steel production, but can no longer absorb a huge portion of it as the once booming economy cools.

Beijing on February 4 announced plans to cut steel production by as much as 150 million tons over the next five years, but this is far short of the 340 million tons that experts say the country is now overproducing every year.

The steel industry is also at the heart of a row at the World Trade Organization where China is pushing to win the coveted "market economy" status.

The status would make it far more difficult for WTO members, including the EU, to impose anti-dumping duties on China.

The EU currently has dozens of anti-dumping measures in place against China, several involving the steel industry.

An impact study is underway by the EU on the potential effects of giving China market economy status, before a decision by the end of the year.

Copyright Agence France-Presse, 2016

Popular Sponsored Recommendations

Empowering the Modern Workforce: The Power of Connected Worker Technologies

March 1, 2024
Explore real-world strategies to boost worker safety, collaboration, training, and productivity in manufacturing. Emphasizing Industry 4.0, we'll discuss digitalization and automation...

Adopting an Open Ecosystem: The Way Forward for Frontline Operations

March 11, 2024
Today's manufacturing tech stack thrives on connectivity, integrating new and legacy players for a seamless operation - not on monolithic systems. Embrace the future of frontline...

3 Best Practices to Create a Product-Centric Competitive Advantage with PRO.FILE PLM

Jan. 25, 2024
Gain insight on best practices and strategies you need to accelerate engineering change management and reduce time to market. Register now for your opportunity to accelerate your...

Transformative Capabilities for XaaS Models in Manufacturing

Feb. 14, 2024
The manufacturing sector is undergoing a pivotal shift toward "servitization," or enhancing product offerings with services and embracing a subscription model. This transition...

Voice your opinion!

To join the conversation, and become an exclusive member of IndustryWeek, create an account today!